NYSE:SMG

Stock Analysis Report

NOT FOR DISTRIBUTION
Header cover image

Executive Summary

The Scotts Miracle-Gro Company manufactures, markets, and sells consumer lawn and garden products in the United States and internationally.


Snowflake Analysis

Established dividend payer with limited growth.


Similar Companies

Share Price & News

How has Scotts Miracle-Gro's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: SMG's share price has been volatile over the past 3 months.


Market Performance


7 Day Return

5.6%

SMG

5.6%

US Chemicals

4.0%

US Market


1 Year Return

33.6%

SMG

-5.7%

US Chemicals

5.0%

US Market

Return vs Industry: SMG exceeded the US Chemicals industry which returned -5.7% over the past year.

Return vs Market: SMG exceeded the US Market which returned 4.9% over the past year.


Shareholder returns

SMGIndustryMarket
7 Day5.6%5.6%4.0%
30 Day0.07%-5.1%-1.1%
90 Day31.9%28.1%21.1%
1 Year36.3%33.6%-3.5%-5.7%7.2%5.0%
3 Year57.7%46.9%15.6%-5.9%36.0%27.1%
5 Year151.4%122.6%35.5%5.0%65.3%46.9%

Price Volatility Vs. Market

How volatile is Scotts Miracle-Gro's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Scotts Miracle-Gro undervalued compared to its fair value and its price relative to the market?

24.9x

Price to Earnings (PE) ratio


Share Price vs. Fair Value

Below Fair Value: SMG ($134.67) is trading above our estimate of fair value ($113.56)

Significantly Below Fair Value: SMG is trading above our estimate of fair value.


Price To Earnings Ratio

PE vs Industry: SMG is poor value based on its PE Ratio (24.9x) compared to the Chemicals industry average (20.6x).

PE vs Market: SMG is poor value based on its PE Ratio (24.9x) compared to the US market (16.5x).


Price to Earnings Growth Ratio

PEG Ratio: SMG is poor value based on its PEG Ratio (2.1x)


Price to Book Ratio

PB vs Industry: SMG is overvalued based on its PB Ratio (9.5x) compared to the US Chemicals industry average (2x).


Next Steps

Future Growth

How is Scotts Miracle-Gro forecast to perform in the next 1 to 3 years based on estimates from 6 analysts?

11.8%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: SMG's forecast earnings growth (11.8% per year) is above the savings rate (2.2%).

Earnings vs Market: SMG's earnings (11.8% per year) are forecast to grow slower than the US market (22.8% per year).

High Growth Earnings: SMG's earnings are forecast to grow, but not significantly.

Revenue vs Market: SMG's revenue (4.3% per year) is forecast to grow slower than the US market (9.2% per year).

High Growth Revenue: SMG's revenue (4.3% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: SMG's Return on Equity is forecast to be high in 3 years time (36.9%)


Next Steps

Past Performance

How has Scotts Miracle-Gro performed over the past 5 years?

15.7%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: SMG has high quality earnings.

Growing Profit Margin: SMG's current net profit margins (8.8%) are lower than last year (10.5%).


Past Earnings Growth Analysis

Earnings Trend: SMG's earnings have grown by 15.7% per year over the past 5 years.

Accelerating Growth: SMG's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.

Earnings vs Industry: SMG had negative earnings growth (-1.9%) over the past year, making it difficult to compare to the Chemicals industry average (-11.3%).


Return on Equity

High ROE: Whilst SMG's Return on Equity (37.87%) is high, this metric is skewed due to their high level of debt.


Next Steps

Financial Health

How is Scotts Miracle-Gro's financial position?


Financial Position Analysis

Short Term Liabilities: SMG's short term assets ($2.0B) exceed its short term liabilities ($981.2M).

Long Term Liabilities: SMG's short term assets ($2.0B) do not cover its long term liabilities ($2.4B).


Debt to Equity History and Analysis

Debt Level: SMG's debt to equity ratio (290.9%) is considered high.

Reducing Debt: SMG's debt to equity ratio has increased from 267.8% to 290.9% over the past 5 years.

Debt Coverage: SMG's debt is not well covered by operating cash flow (7.2%).

Interest Coverage: SMG's interest payments on its debt are well covered by EBIT (5.6x coverage).


Balance Sheet


Next Steps

Dividend

What is Scotts Miracle-Gro current dividend yield, its reliability and sustainability?

1.72%

Current Dividend Yield


Dividend Yield vs Market

Notable Dividend: SMG's dividend (1.72%) is higher than the bottom 25% of dividend payers in the US market (1.67%).

High Dividend: SMG's dividend (1.72%) is low compared to the top 25% of dividend payers in the US market (4.5%).


Stability and Growth of Payments

Stable Dividend: SMG's dividends per share have been stable in the past 10 years.

Growing Dividend: SMG's dividend payments have increased over the past 10 years.


Current Payout to Shareholders

Dividend Coverage: With its reasonably low payout ratio (42.3%), SMG's dividend payments are well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: SMG's dividends in 3 years are forecast to be well covered by earnings (41% payout ratio).


Next Steps

Management

How experienced are the management team and are they aligned to shareholders interests?

8.1yrs

Average management tenure


CEO

Jim Hagedorn (65yo)

19.17yrs

Tenure

US$7,922,384

Compensation

Mr. James S. Hagedorn, also known as Jim, has been the Chief Executive Officer at The Scotts Miracle-Gro Company since May 2001 and has been the Chairman of the Board since January 2003 and has been its Ex ...


CEO Compensation Analysis

Compensation vs Market: Jim's total compensation ($USD7.92M) is about average for companies of similar size in the US market ($USD7.34M).

Compensation vs Earnings: Jim's compensation has increased by more than 20% whilst company earnings have fallen more than 20% in the past year.


Leadership Team

NamePositionTenureCompensationOwnership
James Hagedorn
CEO & Chairman of the Board19.17yrsUS$7.92m0.10% $7.6m
Michael Lukemire
President & COO4.42yrsUS$3.37m0.056% $4.2m
Thomas Coleman
Executive VP & CFO6.25yrsUS$3.03m0.042% $3.1m
Ivan Smith
Executive VP6.75yrsUS$1.72m0.025% $1.8m
Denise Stump
Executive VP of Global Human Resource & Chief Ethics Officer17.42yrsUS$2.13m0.00023% $17.2k
James King
Chief Communications Officerno datano data0.012% $884.2k
Dave Swihart
Senior Vice President of Research & Development12.08yrsno datano data
Phil Jones
Senior Vice President of International Sales5.5yrsno datano data
Scott Hendrick
Senior Vice President of Global Supply Chain9.42yrsno datano data
Mike Hoover
Senior Vice President of Special Operating Forcesno datano datano data

8.1yrs

Average Tenure

59.5yo

Average Age

Experienced Management: SMG's management team is seasoned and experienced (8.1 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
James Hagedorn
CEO & Chairman of the Board19.17yrsUS$7.92m0.10% $7.6m
Brian Finn
Independent Director5.58yrsUS$285.03k0.016% $1.2m
Thomas Kelly
Independent Director13.92yrsUS$285.03k0.015% $1.1m
Katherine Littlefield
Vice-Chairman of the Board7.5yrsUS$285.03k0.011% $805.0k
Adam Hanft
Director10.5yrsUS$285.03k0.060% $4.5m
Nancy Mistretta
Independent Director12.92yrsUS$285.03k0.027% $2.0m
Stephen Johnson
Independent Director9.67yrsUS$285.03k0.037% $2.7m
David Evans
Independent Director2.25yrsUS$285.03k0.0098% $734.0k
John Vines
Lead Independent Director6.5yrsUS$335.05k0.021% $1.5m
Peter Shumlin
Independent Director3.5yrsUS$285.03k0.0074% $550.1k

8.6yrs

Average Tenure

65.5yo

Average Age

Experienced Board: SMG's board of directors are considered experienced (8.6 years average tenure).


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: SMG insiders have only sold shares in the past 3 months.


Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Top Shareholders

Company Information

The Scotts Miracle-Gro Company's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: The Scotts Miracle-Gro Company
  • Ticker: SMG
  • Exchange: NYSE
  • Founded: 1868
  • Industry: Fertilizers and Agricultural Chemicals
  • Sector: Materials
  • Market Cap: US$7.474b
  • Shares outstanding: 55.50m
  • Website: https://www.scottsmiraclegro.com

Number of Employees


Location

  • The Scotts Miracle-Gro Company
  • 14111 Scottslawn Road
  • Marysville
  • Ohio
  • 43041
  • United States

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
SMGNYSE (New York Stock Exchange)YesCommon SharesUSUSDJan 1992
SCQADB (Deutsche Boerse AG)YesCommon SharesDEEURJan 1992
0L45LSE (London Stock Exchange)YesCommon SharesGBUSDJan 1992

Biography

The Scotts Miracle-Gro Company manufactures, markets, and sells consumer lawn and garden products in the United States and internationally. The company operates through three segments: U.S. Consumer, Hawthorne, and Other. It offers lawn care products, such as lawn fertilizers, grass seed products, spreaders, other durable products, and outdoor cleaners, as well as lawn-related weed, pest, and disease control products. The company also provides gardening and landscape products, including water-soluble and continuous-release plant foods, potting mixes and garden soils, mulch and decorative groundcover products, plant-related pest and disease control products, organic garden products, and lives goods and seeding solutions. In addition, it offers hydroponic products that help users grow plants, flowers, and vegetables in an indoor or urban environment; and insect control products, rodent control products, and weed control products for home areas. The company offers its products under the Scotts, Turf Builder, EZ Seed, PatchMaster, Thick’R Lawn, GrubEx, EdgeGuard, Handy Green II, Scotts OxiCleanTM3, Miracle-Gro, LiquaFeed, Osmocote, Shake ‘N Feed, Hyponex, Earthgro, SuperSoil, Fafard, Nature Scapes, Ortho, Miracle-Gro Organic Choice, Nature’s Care, Whitney Farms, EcoScraps, Gro-ables, Hydroponics, Gavita, Botanicare, Vermicrop, Agrolux, Can-Filters, Sun System, Gro Pro, Mother Earth, Hurricane, Grower's Edge, AeroGarden, Ortho Weed B Gon, Tomcat, Roundup, and Groundclear brands. It serves home centers, mass merchandisers, warehouse clubs, large hardware chains, independent hardware stores, nurseries, garden centers, e-commerce platforms, food and drug stores, and indoor gardening and hydroponic distributors and retailers through a direct sales force, and network of brokers and distributors. The Scotts Miracle-Gro Company was founded in 1868 and is headquartered in Marysville, Ohio. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/07/05 23:49
End of Day Share Price2020/07/02 00:00
Earnings2020/03/28
Annual Earnings2019/09/30


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.